Debt

How A Sticky Note Helped Me Get Out of Debt

It did not take the newest financial planning app to get me out of debt. It did not take a large cash windfall or death of some mysterious, wealthy relative who I’d never met. It was a lot more low-tech than that.

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C is for Collateral

Loans with collateral are referred to as “secured debt,” and loans without as “unsecured debt.”

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To Pay Back Loans Faster, Go West, Young Man

Nearly three-quarters of college students borrow funds to pay for school these days and, as we know, it is not always easy — or possible — to pay those loans back. Well, it turns out one thing you might be able to do to help yourself succeed is move. Specifically, move west.

According to schools.com, four of the top five states for student loan repayment are on the Pacific side of things: Utah, Wyoming, Washington, and Nevada. (The fifth is Virginia so the Atlantic gets a brief nod.) California and Colorado also place in the top 10. But stop short of Cali: San Francisco is a luxury ghost town these days. (“On average, 39 percent of condos built since 2000 have absentee owners, and for newer buildings like One Rincon Hill, that number is 50 percent or above.”) Also there’s no water.

Why is the West such fertile ground for loan repayment? Low unemployment rates, low cost-of-living, and high incomes boost Utah and Wyoming. Washington State, Wyoming, and Nevada make things easier on residents by not charging income tax. Wait, what?

FYI, there are only seven states that don’t charge income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.  I can understand the small and the oil-rich not needing to profit off individuals but how on earth do huge states with significant populations of poors and olds like Texas and Florida get away with that? Texas makes up the difference via property taxes, “some of the highest in the nation.” New Jersey and New Hampshire are also expensive places to own property. And Florida … is there anything good to say about Florida?

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Job of the Day: Debt Collector

Jake Halpern at the Times spent the day at a debt collection agency, even going so far as to jump on the phone — at the agency’s insistence — and hound people with outstanding debts.

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My Debt Problem Began With a Wallet

I applied for my first credit card during my junior year of college. The application required an annual salary, which I didn’t have. But not having an annual salary wasn’t an option, so I checked the box indicating $100,000-$120,000. I justified the lie with the internal argument that my father’s income at the time must have been about that—or so I then suspected. I must have been wrong, though, since my father declared bankruptcy two years later. But this is about me and my money mess, not his.

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Let’s Throw Some Money at Our Problems: September 2014 Check-in

It’s time to check in on our debt payments and savings goals again. If you’re joining us for the first time, you can read about our decision to publicly keep track of our debt here.

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Secret Debt Threatened My Marriage

“Debt is like living in the past.” His hands now flapped their emphasis in the air. “How can we move forward into the future if you’re stuck in the past?”

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How It Feels to Pay Off $70,000 in Debt

By the time I finished my master’s degree in 2011, that “nonissue” undergrad loan had grown to $20,000, and I had $50,000 of brand-new debt to pile on top of it. This felt like a real, burdensome amount of money that I owed now. My first bill informed me that I was saddled with minimum monthly payments of roughly $700 for the next 10 years, with an astoundingly high portion going to interest.

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Magic Words That Will Save You $$$

Jake Halpern’s noir-ish story in the NYT Magazine about debt collection is scarier than Sin City. Poor Theresa! (We are all Theresa.)

there was little that Theresa could do; she had paid off her debt to the wrong collectors and had fallen into the debt underworld. If anyone was going to help her, it wouldn’t be the state attorney general, or the Better Business Bureau, or the F.T.C., or even the police, but the former banker and the former armed-robber who bought her debt.

The most valuable takeaway from the piece, as underlined by an interview Halpern gives Ira Glass on “This American Life,” though, is that a few magic words can make the whole nightmare go away.

Jake Halpern: [The lawyer] said, oh, well, when a consumer actually shows up in court and says the magic words, then these cases basically evaporate. And I say, the magic words? He says, yeah. Show me the evidence.

Ira Glass: Show me the evidence. In other words, show me where you got this number, $3,762.20. The Georgia Legal Services lawyer told Jake that if you’re standing before a judge and you say, OK, I don’t recognize this amount that you say I owe, and I want to see some documentation, I want to see account statements or whatever, because I have no way to know with certainty that this debt is really mine, the judge will usually turn to the other side and ask for the evidence. And in all likelihood, they’ll have no documentation and they’ll drop the case. And this is true not just in Georgia, but elsewhere. Because the way this business works, Jake says, when credit card companies sell these IOUs to debt collection companies, they usually don’t give them any documentation. Usually they just give them a spreadsheet with a long list of people who owe money on their credit cards and their addresses and the last payment and how much they owe, and not a whole lot more than that.

Amazing!! You have the right to remain silent, America, or to use the magic words that will set you free. Think you’ve got it down? Test your skills by playing the game!

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$1.4 Million in Assets, a Million in Debt

I usually enjoy reading the money makeover column in the Los Angeles Times, which runs every two months or so (and, coincidentally, was once written by Helaine Olen in the ’90s). The latest installment focuses on Ross and Michelle Meador, a couple who lives in Fullertorn with their three children and have $1.4 million in assets including a house in Berkeley that they rent out, but a million dollars in debt, including student loans, a mortgage, a HELOC (home equity line of credit—basically borrowing against your house), and mortgage debt.

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Let’s Throw Some Money at Our Problems: July 2014 Check-in

It’s time to check in on our debt payments and savings goals again. If you’re joining us for the first time, you can read about our decision to publicly keep track of our debt here.

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